The European Union, which is a major consumer of timber products, is drawing up a process and a package of measures to combat the growing problem of illegal logging and related trade. The principal objective is to improve governance in timber-producing countries and to set up voluntary partnerships with them so that only legally harvested timber enters the EU.

ACT

Communication from the Commission to the Council and the European Parliament: Forest Law Enforcement, Governance and Trade (FLEGT): Proposal for an EU Action Plan [COM(2003) 251 final – Not published in the Official Journal].

SUMMARY

SCOPE AND OBJECTIVES OF THE ACTION PLAN

This communication proposes the implementation of a specific process and a package of measures to address the problem of illegal logging and related trade, which is becoming an increasing concern. Illegal logging takes place when timber is harvested in violation of national laws.

The principal objective is to improve governance in timber-producing countries and to set up voluntary partnerships with them so that only legally harvested timber enters the EU.

The Action Plan targets four key regions and countries which, taken together, contain nearly 60% of the world’s forests and supply a large proportion of internationally traded timber – Central Africa, Russia, Tropical South America and Southeast Asia.

COMPONENTS OF THE ACTION PLAN

The Action Plan has several facets:

Support to timber-producing countries

Efforts will be focused on promoting solutions to the problem of illegal logging which are equitable and do not have an adverse impact on poor people. The European Union could, for example, provide support to community-based forest management and help propagate lessons from its initiatives in terms of national laws and policies. It could also work with partner governments to ensure that key underlying factors, such as land tenure and access to forest resources, encourage local participation in the fight against illegal logging.

It can also help partner countries come up with systems to check that timber has been harvested legally. Putting such systems in place will also require technical, institutional and other forms of capacity building for governments, civil society and the private sector.

The timber trade

The Union will set up a long-term dialogue process with timber-producing and timber-consuming countries, with a view to extending international collaboration in the fight against illegal logging and setting up a multilateral framework as a basis for action.

In the near future, a voluntary licensing scheme will be proposed whereby partner countries issue a permit attesting to the legality of timber exported to the EU. The Commission will propose a regulation setting up the scheme. This regulation will define the products to be included and describe the licence authorisation required.

The Commission will examine the impact of further measures, notably, in the absence of multilateral progress, the applicability of a regulation designed to address imports of illegally harvested timber.

Public procurement

Practical information will be provided to contracting authorities demonstrating how to procure timber from sustainable sources under public procurement procedures currently in force in the EU.

Current public procurement legislation, as well as the proposed future legislation, offers a number of possibilities for taking into account environmental factors in public procurement procedures.

Private-sector initiatives

Measures are proposed to encourage private-sector initiatives for good practice in the forestry sector, including the use of voluntary codes of conduct to source only legal timber.

Financing and investment guarantees

Banks and financial institutions investing in forest-sector operations will be asked to draw up procedures that include, among the precautions to be taken, the social and environmental impact of loans to the forest sector and respect for the legislation in force.

Export credit agencies, for their part, will be encouraged to draw up guidelines for screening procedures and codes of practice for forest-sector projects.

Combating money laundering

The Commission will encourage Member States to designate illegal logging as a crime for the purposes of the EC Directive on money laundering.

Currently only a small number of Member States designate crimes relating to illegal logging under their money-laundering legislation.

Conflict timber

The Commission will attempt to address, through programmes of development cooperation among others, the problem of armed conflicts that are financed by illegal logging activities.

Implementation

To help implement the above activities, it is proposed that the EU provide a coordinated response, drawing on the strong points and capacities of the Commission and EU Member States. A work programme will be drawn up with the latter to assist the process.

NEGATIVE CONSEQUENCES OF ILLEGAL LOGGING

Illegal logging is closely associated with corruption and organised crime, undermining the rule of law, principles of democratic governance and respect for human rights.

In some cases the illegal exploitation of forests is also associated with violent conflict. Profits from the illegal exploitation of forests (and of other natural resources) are often used to fund and prolong these conflicts.

Illegal logging and related trade undermines the competitiveness of legitimate forest-sector industry operations in both exporting and importing countries. In so doing, this limits these industries’ ability to conduct operations that foster sustainable forest management and sustainable development generally.

Illegal logging also causes enormous environmental damage and loss of biodiversity. In the long term, it can end up having a negative impact on the forest-based livelihoods of many of the world's poorest and most marginalised people.

Illegal logging thus undermines many essential elements of the EU’s development objectives: public-sector financing for development targeted at the poor, peace, security, good governance, the fight against corruption, and sustainable environmental management.

RELATED ACTS

Proposal for a Regulation of the European Parliament and of the Council of 17 October 2008 laying down the obligations of operators who place timber and timber products on the market [COM(2008) 644 final – Not published in the Official Journal].
The Regulation imposes obligations on persons and companies who place timber or timber products on the market within the Community to reduce, as much as possible, the risk of products derived from illegal logging being placed on the market. In particular, the Community intends to combat deforestation and biodiversity loss in the world. Operators must use a framework of procedures which:

The Regulation establishes a list of products which the rules apply to.

Council Regulation (EC) No 2173/2005 of 20 December 2005 on the establishment of a FLEGT voluntary licensing scheme for imports of timber into the European Community [Official Journal L 347, 30.12.2005].
This Regulation establishes a Community set of rules for the import of certain timber products for the purposes of implementing the FLEGT licensing scheme. It contains measures designed to fight illegal logging and trade in the timber thus obtained, both being practices which cause heavy losses in developing countries and damage the environment. The approved measures involve setting up voluntary partnerships with a view to supporting and encouraging governance reform in those countries most severely affected by illegal logging and with a view to establishing a licensing scheme with partner countries to ensure that only legal timber coming from these countries is imported into the EU.